Preservation in the News

Some residents of Western North Carolina struggling under the weight of rising property taxes will now have another tool at their disposal to help ease the burden.

Recent legislation passed by the General Assembly adds another category to the list of land that currently qualifies for a property tax reduction — namely farmland and forestry. The new addition is “wildlife habitat,” and acreage that falls under that designation could qualify for thousands of dollars in property tax breaks.

Under the bill, land of at least 20 and not more than 100 acres qualifies for wildlife habitat status if the property is home to an animal on the state’s protected species list, or if the property contains one of six designated wildlife habitats, such as a stream or rock outcrop.

Landowners must work with the state Wildlife Resources Commission to develop a management plan. They’ll get specific instructions on what they need to do for the species or habitat type on their property.

Proponents of the bill are hailing it as an incentive to property owners to preserve open spaces.

“Say you have 75 acres, and don’t want to sell your land, but can’t afford the property taxes,” said Edgar Miller, a lobbyist for the North Carolina Conservation Trust, which fought for the bill’s passage. “This will provide an incentive to keep the land in open space for people who aren’t necessarily farmers, but who don’t want to pay exorbitant property taxes.”

Tom Bean with the North Carolina Wildlife Federation also applauded the alternatives for conservation the bill will provide landowners.

“Landowners who do not want to farm or do forestry have another option for how they manage their land,” he said.

And this could mean big, big breaks for landowners. If land qualifies for an exemption, it’s no longer valued at market rate and subject to the county’s typical revaluation process. Instead, it’s tagged with a value that’s much, much lower and reflects what the land is actually used for.

According to Haywood County tax assessor Judy Ballard, the going rate in the mountains is between $20,000 and $30,000 an acre. But in Haywood, horticultural land is valued at $710 per acre; agricultural land at $355 per acre; and forestry land at $80 per acre.

The discrepancies can get even wider.

“Some of the most valuable property we have is on top of mountains and has rock outcroppings,” says Macon County Tax Administrator Richard Lightner, referring to land that would qualify for a wildlife habitat exemption. “You could potentially have something worth $150,000 or $200,000 an acre that’s now less than $1,000 per acre.”

Long time coming

The wildlife habitat bill is the culmination of nearly six years of work on the part of environmental groups. The North Carolina Conservation Trust, Environmental Defense Fund, and the North Carolina Wildlife Federation were big players in building a broad base of support for the legislation.

It wasn’t easy. The state Association of County Commissioners came out against the bill out of fear it would cause counties to lose too much property tax revenue. The state Farm Bureau also lobbied against it.

“The Farm Bureau’s concerns were that by expanding the (tax reduction) program beyond its current categories, it would then cause the overall program to be more expensive statewide and lead to more scrutiny,” explained Miller.

Through a process of give and take, Miller and others were able to get everyone on board. They reworked the bill to increase the minimum qualifying acreage from 10 to 20, reducing the administrative burden on county tax offices. They also narrowed what would qualify as a wildlife habitat to appease the Farm Bureau.

But even with the parties seemingly in agreement, Miller said he thought less than three weeks ago that the bill was dead. It had passed in the House last session, but languished in a Senate subcommittee. So supporters made one final push.

“The key for us was really bringing forward the landowners who were being faced with disincentives for conserving their land and have them really start talking to their senators,” Miller said.

The bill passed unanimously in the Senate.

Breaks for residents, bonus for wildlife

Jackson County Commissioner Tom Massie said he and other commissioners strongly believed in the wildlife habitat bill “and took an active role in terms of lobbying legislators.” Massie traveled to Raleigh and talked with multiple people in favor of the bill.

Commissioners even went so far as to take a stand that put them at odds with the NC Association of County Commissioners.

“Our board went against the association’s judgement and said we thought it was a good deal and we supported it,” Massie said.

Though Massie sees the value of preserving open spaces — a significant goal of the legislation — he says that’s not why it earned the support of the Jackson commissioners. Faced with a recent property revaluation that upped the value of some properties as much as 40 percent, Massie said the commission was desperate for a way to ease the property tax burden on its residents.

“The main thing was to provide another opportunity for property tax relief,” he said. “(The bill) didn’t necessarily have to be for wildlife or farming — it could have been for anything.”

Massie said in the short term, the wildlife habitat bill was the only hope commissioners had to reduce property taxes.

“It is the only thing we could do this year to provide some immediate tax relief,” he said. He says the loss in revenue for Jackson County is worth it to benefit the public as a whole. He knows it won’t help out everyone, but that it’s “one tool that makes the property tax burden a little bit easier to swallow for citizens.”

Though property tax reduction was a big draw for many communities in their support for the wildlife habitat legislation, benefits will extend into other areas, says Bean, of the N.C. Wildlife Commission. Hunters and fishermen could be one group to benefit.

For example, says Bean, “a lot of landowners want to get quail back on their land, and a lot have said they’ll bite the bullet and pay higher taxes to do practices specific to increasing quail populations.”

Quail favor early successional habitats – a prairie-like environment with grasses and few mature trees. If a landowner maintained such a habitat, they could qualify for the wildlife habitat exemption.

The same tax breaks could apply to landowners with trout streams on their property.

“Think of what the impact would be in WNC, where we have a lot of trout streams,” said Massie. “Now you can actually qualify for a tax break by managing trout buffers in such a way that it’s good for both fishery and sales.”

Wildlife can be a draw to an area, both for tourism or hunting and fishing. Preserving and protecting species “could address something we’ve been lacking in some ways in WNC,” said Massie. “We don’t have a huge population of certain types of animals, and this can potentially increase those populations.”

While it’s not a be all and end all solution, the wildlife habitat bill is a step in the right direction for protecting wildlife.

“It would not be true to say this will stop the loss of habitat to development, but what it does mean is that the open land that remains, some of it will be able to be managed more aggressively and specifically to provide wildlife habitats,” Bean said.

Some oppose loss of revenue, control

Just one county over, Macon County commissioners have an altogether different take on the wildlife habitat bill than Jackson officials. The board passed a resolution opposing the legislation.

It’s not that high property taxes aren’t a problem in Macon. But unlike Jackson commissioners, those in Macon County decided that ultimately, the county would lose too much revenue if the wildlife habitat exemption was created.

“It could certainly affect the tax base. It’s hard enough for the counties to get by now,” said Commissioner Ronnie Beale.

The negative impact would be felt most in the mountains, said tax administrator Lightner.

“Because of the uniqueness of the Great Smoky Mountains, we will lose more value in the mountains than anywhere else,” he said. “Generally speaking, a county in the middle of the state, their values are not per acre as high as ours. You don’t have the federal government owning 50 percent of the land, and you don’t have large resort areas.”

For many counties, property taxes supply the only revenue stream outside of state and federal funding. Beale thought the state’s attempt to legislate something to do with property taxes was offensive.

“This is just another way of the state saying, we can manage your county better than you can,” he said. “We disagree.”

Miller of the N.C. Conservation Trust was well aware of counties’ concerns over the impact the wildlife habitat legislation would have on property tax revenues. But he contends that “expanding the (property tax exemption category) slightly won’t be a significant cost to counties.”

“It would in fact only have an impact of $3 to $4 million statewide. It’s a very cost effective way for counties to protect wildlife habitat and open space without having to acquire the land,” Miller said.

Still, there were other issues that concerned Macon officials. Lightner, whose personal opinion commissioners based their resolution on, maintains that the legislation is inequitable taxation. Farmers, for example, also qualify for tax breaks, but they invest large sums of their own money into the land to produce crops. But under the wildlife habitat legislation, having a protected species happen to live on your land means you would qualify for a tax break.

“Basically, you don’t have to do anything to your land and invest no money,” he said. “There’s a big disparity on that. People can buy property, own it five years, and come in and get a tax write off.”

Lightner says the legislation could also drive up tax rates because rates will have to be increased in order to give one group a tax break. Additionally, he says, it could cost the counties in the long run by necessitating more paperwork and staff.

“It’s another unfunded mandate in my professional opinion,” he said.

Miller, though, says the parties involved tried to rework the legislation in order to address some of the concerns brought forward.

“My hope is that the changes that were made will tighten the eligibility criteria, eliminate the administrative burden on counties, and minimize financial impact,” he said.